Single Mom Masterminds $700K Swing From Debt to Savings

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NerdWallet College Savings Retirement

Taje Perkins, left, poses for a photo with her mother Takiia Anderson on her first day at Spelman College in Atlanta. (Nerdwallet via AP)

When Takiia Anderson graduated from Boston College Law School in 1999, she was a single mom with a 2-year-old child, nearly $100,000 in student loans and a new job as a government attorney that paid $34,102 a year. She didn’t like that math.

“People are talking about 20 years to pay off a student loan, and my daughter is going to college in 16 years,” recalls Anderson, now 47 and based in Atlanta. “I didn’t want to be in a situation where I’m helping her pay for college while I’m still paying my student loan.”

Today, Anderson’s student debt is long gone. She has nearly $500,000 in retirement savings, and her daughter, Taje Perkins, finished her third year at Spelman College in Atlanta with no student loans to cover its nearly $30,000 per year in tuition and fees.

How did she do it? She set a series of targets and kept a laser-like focus on them that, even though she later became a high-earner and has ridden a surging stock market, can serve as a lesson to others today.

“Any time I got a raise, a bonus or a tax refund, I put it toward my debt, my daughter’s education savings and then retirement,” Anderson says.

TOUGH CHOICE: SAVE FOR RETIREMENT OR COLLEGE?

Many financial advisers would advise flipping those last two priorities: “The same way that airplane announcements tell us parents should put on their own oxygen masks before assisting their children, parents should prioritize saving for retirement and putting themselves in a good financial position before saving for their children’s education,” says Paul R. Ruedi, CEO of Ruedi Wealth Management in Plano, Texas.

Yet more parents like Anderson are prioritizing saving for college over retirement — 56 percent are doing the former vs. 54 percent the latter, according to a recent survey by Sallie Mae , one of the nation’s largest student loan lenders.

“Although college wasn’t as expensive when I went in 1989, I know what it’s like not to have to pay those bills, and that’s what I wanted for her,” says Anderson, a Howard University graduate.

TACKLING HER BIG DEBT FIRST

Anderson attacked her student loan debt first with single-minded determination.

“We didn’t have cable. No internet,” she recalls, adding that instead, they watched old or borrowed DVDs and …read more

Source:: Atlanta Black Star – News

      

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